Quote Originally Posted by carl View Post
Like I said, the whole thing boils down to bad home loans.
You have to add in the perception that if you pool enough dubious loans together they somehow cease to be dubious. Add that to a huge supply of free money (interest rate below inflation rate = free money), and the incentive to take risks on loans becomes overwhelming. If you set up a situation where people can borrow at 1.5% and lend at 7% with zero perceived risk, no amount of regulation or oversight is going to keep speculators from riding that out of control.